[LMB] Thoughts about Tau Verde and Money On Topic

Pouncer pouncer at aol.com
Tue Nov 24 03:28:14 GMT 2020


Andras Farkas revealed:

 >I have a thought though.

Reading Bujold will do that to a person...

 >What if Tau Verde had their own miniature time of isolation? Or
 >something equivalent.  That'd be a very intriguing and fitting
 >answer to some things about them. [snip]  It's quite possible,
 >to perhaps have the rest of humanity just not have time for
 >*you* and your planet while they're busy with newly cropped-up
 >local problems, and leave newly-settled planets alone for a
 >while.

Yeah... thinking is fun.  Let's do more.

Miles's smuggling effort was rewarded with pay in Felician
"millipfenig".  A pfennig is a penny, a small coin, often copper
or brass, with a very small fraction of the value or worth of a more
common base unit of currency money in silver or gold. So many 100
or 240 pennies per mark or pound or crown or thaler or dollar...
The prefix "milli" of course is one-one-thousandth.  So at some
point Tau Verde and/or Felice experienced "run-away" DEFLATION.

Real Life provides few examples of such extreme currency
problems, or manipulation.  The US between the Civil War and end
of the century experienced some, as industrial production
outpaced, well, everything.  Germany also saw post-war deflation
in the 1930's as part of a worldwide depression -- a phase in
their history overshadowed by the extreme INflation that
followed. The U.S. scare in 2008-09 variously known as "the housing
bubble" or "The Great Recession" involved some banking failures
and deflationary pressures. But by and large inflation is much
more common.  Even in historical eras with commodity money --
gold -- the ruler's mints were always tempted to adulterate
coinage with base metals, or shave down to new thinner or smaller
coins with the same face value as the older ones.  Same effect --
money worth less.

When the face value of money is worth less, it takes more and
bigger piles of it to do its job. This tends to result in minting
and printing higher denomination coins or bills.  As now a penny
(one cent coin) is nearly worthless and talk centers around
abolishing it... a one dollar or mark or pound can become so
valueless that it's not worth having a one dollar or one mark or
one pound coin.  The smallest unit of trade for, say, a cup of
coffee might become a ten dollar coin.  German runaway hyperinflation
led to printing of 100,000 ReichMark bills. It's now a problem in
Zimbabwe and Venezuela and South Sudan... very common, actually.

Runaway deflation would mean that the face value of money is
increasing.  It takes less and less of each unit to do the job. A
cup of coffee that once cost a pound goes down to 12 shillings,
then six shillings, then two, then six pence ... The need for
smaller and smaller units of account to track exchanges for daily
operations will lead to units like half pennies (ha'penny).  In
remote and impoverished parts of the old Empire of Great Britain
(based on the Pound Stirling) the crown minted one-fourth penny
coins (farthings) representing a day's wage or a week's meals...
farthings that were barely book-keeping entries for tax
accountants back in London.

It seems to me that at SOME point in Tau Verde's history
deflation went bat-poop crazy. The base unit of credit was
probably an Earth unit, provided and collected by GalacTech as we
saw on Rodeo in Leo Graf's time. If GalacTech paid fewer and
fewer units into the economy, the units became rarer and more
valuable.  Small trades became recorded in fractions of a unit.
Tenths, hundredths.  Pennies.  When the problem worsened, if
trade was to be tracked at all it happened in tenths of tenths
... down to thousandths of hundredeths. Millipfennig.  THIS was
the currency paid locally denominating trade in cups of coffee or
pounds of flour or hours of work or surface carriage of cargo
from Pel to Felice and back. GalacTech (galactic) imported
luxuries -- weapons from Beta Colony or Necklin Rods or other
stuff -- were priced in units as rarely seen as the luxuries
themselves.  Hardly mattered to an economy so -- dare we say --
isolated. At rock bottom, the money stabilized. The name remained.

At some LATER time trade with other galactics who may have had
their own economic ups and downs put the local Tau Verde unit on
par with whatever was used, also locally, on Rodeo or Orient or
Frost IV.   In real life, some analysts put tongue in cheek and
refer to a McDonald's "Big Mac index".  A standard item of meat
and dairy and grain and vegetables from chilled transport and
locally prepared under commonly understood quality rules ... it's
not much of a basis for commodity money but,  doing the job.  So
before "the war" and the Oserean Blockade, say one millipfennig
would buy one Big Mac. Such a currency would be listed in
information and banking markets and have an exchange value of its
own. Speculators hoping the Komarran trade fleets would bring
home bacon from those corners of the Nexus might trade 1000
currency from poor overlooked Ylla to buy 900 from Felice ... and
hope to sell it back at 1200 a month later. Both Ylla and Tau
Verde have similar economies, so -- Close enough to par to be
worth the game.

Whatever happened, just before or during "the war", millipfennigs
started to experience the reverse of its original problem.  Hyper
inflation. The bills and coins and plastic chits are all in just
the same denominations as before.  But it takes a whole fistful
to buy the Big Mac. A carton of it for an ordinary -- whatever.
Wristcom.  And a pallet load of the highest denominated
millipfennig chips ever made, just to cheat a galactic smuggler.

The Osereans were hired specifically to STOP smugglers.  Hmm.

The millipfennig dropped off the currency trading markets when
trade and smuggling stopped.  Once Admiral Naismith opened the
space lanes again, currency markets starting listing values
again.

Hmm. Again.

So do we wonder if Tau Verde's whole freakin' war was an effort
by evil zillionaires to profit from manipulating currencies?  And
IF so,  what other wars, and mercenary front groups, are out
there pulling similar shenanigans?  And would such a nefarious
manipulator begin to take notice of the mysterious Little
Admiral?




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